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Huawei plans to leave United States market to help US-China relations

updated 06:22 am EST, Tue December 3, 2013

Persistent security claims by US officials behind market exit

Huawei is planning to pull out of the United States, according to an interview with CEO Ren Zhengfei. The head of the company is effectively giving up on the US market, following two years of criticism and intense scrutiny by the US government, along with accusations that the telecommunications company is helping the Chinese government spy on US citizens and businesses.

In an interview with French journalists picked up by Foreign Policy, Zhengfei advised "If Huawei gets in the middle of US-China relations, it's not worth it. Therefore, we have decided to exit the US market, and not stay in the middle." The extent of the exit was not advised at the time, as it could just mean that the company will not be seeking out more opportunities in the country and will only deal with its existing business arrangements. Ren did not mention whether its US offices will close in the future, but analysts suggest that the company's research and development work in the country will continue for some time.

Company vice president William Plummer said "It is true that Huawei has adjusted our priority focus to markets that welcome competition and investment, like Europe," and believes that Zhengfei's comments are a "comment on the current market environment." Huawei executive Eric Xu advised in April "we are not interested in the US market anymore," with the comments responding to questions raised by a US House Intelligence Committee report, one which effectively called the state-supported manufacturer a threat to US national security.

Huawei has spoken out against its critics a number of times over the last year. Plummer shouted down accusations from critics, such as former head of the CIA and NSA Michael Hayden, asking them to "Put up. Or shut up." and that claims without supporting evidence are "politically-inspired and racist corporate defamation, nothing more." Zhengfei also waded in to the discussion in a rare appearance, claiming "Huawei has no connection to the cyber-security issues the US has encountered in the past, current, and future."

The US issues are only part of Huawei's problems. A report in late 2012 claimed that the company offered to sell at least 1.3 million euros of embargoed equipment to the largest mobile phone operator in Iran two years prior. There have also been concerns about Huawei's involvement in providing content filtering to Internet service providers in the United Kingdom, following a speech by Prime Minister David Cameron praising the filters in protecting children from online dangers.

by MacNN Staff



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